National cleaning company sues Waterpro Restoration over alleged non-compete infraction

A national cleaning company is suing a Ridley Park franchise over allegedly breaching a non-compete contract.

Rainbow International LLC, filed a lawsuit Oct. 13 in the U.S. District Court for the Eastern District of Pennsylvania against John Sullivan, Deborah Sullivan, and Sullivan Certified Restoration LLC, doing business as Waterpro Restoration, claiming they entered into a franchise agreement and allege the Sullivans breached it.

Rainbow claims the Sullivans signed a 10-year, non-compete franchise agreement on Nov. 16, 2005, which would prohibit them from entering into any other such agreement or use any competitor's products for two years afterwards. Rainbow claims that one year prior to the agreement expiration, the Sullivans opened a new business, Waterpro Restoration, marketing a similar business model, and using the same telephone numbers, thus violating their agreement.

Rainbow is seeking that the Sullivans be restrained from participating in any form of competitive agreement as stipulated in their franchise agreement, as well as be required to discontinue use of Rainbow's methods of operation. Rainbow also asks for a transfer of the Sullivan's customer list and to discontinue use of their telephone number, as well as a sum of money equal to 104 times the largest weekly franchise service fee as stipulated in the franchise agreement, attorney's fees, and any such relief the court sees fit.

Rainbow is represented by Harris Chernow and Steven Kapustin of Reger Rizzo Darnall LLP, in Philadelphia; William M. Bryner of Kilpatrick, Townsend, & Stockton LLP in Winston-Salem, North Carolina; and James W. Faris Jr. of Kilpatrick, Townsend & Stockton in Atlanta, Georgia.

U.S. District Court for the Eastern District of Pennsylvania case number 2:15-cv-05584-JS